In Making a Capital Budgeting Decision, One Needs to Compare

question 65

Multiple Choice

In making a capital budgeting decision, one needs to compare cash flows in terms of their amounts and when they occur.One way to do so is to determine their

• A)future value.
• B)present value.
• C)average cash outflows.
• D)opportunity costs.

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Definitions:

Sample Mean

The average calculated from a sample set of data, used as an estimate of the population mean.

Point Estimator

The sample statistic, such as x, s, or p, that provides the point estimate of the population parameter.

Simple Random Samples

A subset of a statistical population in which each member of the subset has an equal probability of being chosen.

Population Size

The total number of individuals or units in the population being studied.